A revocable living trust is often touted as a way to avoid probate and maintain privacy. By transferring assets into the trust during your lifetime, those assets can pass to beneficiaries without court supervision. This can save time and costs and keep your affairs private.
Trusts also provide continuity if you become incapacitated. Your chosen successor trustee can manage assets without the need for a court-appointed guardian.
As the grantor and trustee of a revocable trust, you retain control. You can add or remove assets, change beneficiaries, or revoke the trust entirely.
Because you maintain this control, all income from trust assets is reported on your personal tax return. This flexibility makes revocable trusts attractive for people who want to keep their estate plan up‑to‑date without sacrificing access to assets.
Despite marketing claims, revocable trusts do not protect assets from your creditors. Nolo explains that because you remain the owner for liability purposes, creditors can reach trust assets. You are treated as the owner because you can revoke the trust and reclaim the assets at any time.
Only irrevocable trusts, where you relinquish control and beneficial ownership, offer meaningful asset protection. Likewise, a revocable trust does not reduce estate taxes or qualify you for Medicaid, so other planning tools may be needed for those goals.
A trust only avoids probate for assets properly titled in the trust. If you forget to retitle bank accounts, real estate, or vehicles, those assets may still go through probate.
Work with an attorney to prepare deeds and transfer documents, and regularly review your asset list. Also, coordinate beneficiary designations on retirement accounts and insurance policies with your trust plan.
Revocable trusts are valuable tools, but not cure‑alls. At Schnauss Naugle Law, we can help you evaluate whether a trust makes sense, draft clear documents, and ensure your assets are properly funded. If you’re ready to create or review your estate plan, contact our office today for guidance. Call us at 904-643-6342 or fill out our online intake form.
